Correction: It appears that Gillibrand's amendment on proprietary trading was notincorporated into the manager's mark, but her exemption for foreign exchange derivatives was.
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Yeah, you read that headline correctly. Senate Democrats have just weakened Blanche Lincoln's derivatives language within the overall Wall Street reform legislative package.
Lincoln's language on derivatives will be combined with the rest of the bill in the manager's amendment once it is on the floor. Unfortunately, it seems that Senate Democrats, led in this instance by Kirsten Gillibrand (NY), Bob Casey (PA) and Debbie Stabenow (MI), thought that Blanche Lincoln, that paragon of liberalism, went too far. So, several exceptions to Lincoln's derivatives language were inserted during the committee mark-up process:
Subscription-only Congress Daily discussed the Gillibrand exemptions last night. While this article is written in the conditional, and Gillibrand did not actually offer the amendment, she still succeeded in forcing some these changes into the bill:
Senate Agriculture Chairwoman Blanche Lincoln's stance against Wall Street reflected in her derivatives bill has drawn the protest of Sen. Kirsten Gillibrand, D-N.Y., whose state is home to the large banks that dominate the over-the-counter trading market. Gillibrand is attempting to scale back a provision in Lincoln's bill, which will be marked up today, requiring large commercial banks to spin off their highly profitable swaps desk. The Lincoln measure will be merged with Senate Banking Chairman Christopher Dodd's regulatory revamp package, which is likely to be on the floor next week.
Gillibrand has sponsored an amendment that would put up roadblocks to Lincoln's language prohibiting banks from receiving FDIC deposit insurance or accessing the Federal Reserve discount window if they trade in swaps or securities-based swaps. The bill would effectively force JPMorgan Chase, Goldman Sachs, Citigroup, Morgan Stanley and Bank of America to spin off their swaps desks, which bring in billions of dollars in revenue annually. All except Bank of America are headquartered in New York, though its Merrill Lynch investment banking subsidiary is housed in the city.
The amendment would require the Commodity Futures Trading Commission to undertake a study on banks that had swap operations as to whether they pose a risk to the FDIC system and the impact of barring them from offering such services. The CFTC would then propose rules based on the findings, which would have to be approved on a two-third vote by a panel representing the Fed, Treasury, the SEC, the FDIC and the Office of the Comptroller of the Currency.
And it wasn't just Gillibrand. Bob Casey secured permanent exemptions for pension funds that deal in derivatives. Debbie Stabenow of Michigan pulled some corporate home-state pork by securing exemption for Ford Motor Finance and other highly leveraged financial subsidiaries of manufacturing and homebuilding firms.
When it comes to placating home-state interests, many Democratic Senators can be hard right-wingers. That Gillibrand, Stabenow and Casey moved to the right of Blanche friggin' Lincoln, and successfully poked holes in her derivatives language, is a good example of this.
A Natasha Chart Golden Oldie
From Wed Jan 28, 2009. Original HERE.
Staff Sgt. Ryan Maseth, a 24 year old Green Beret, died in Iraq last January in a military base bathroom, of electrocution. He's one of 13 soldiers to die because of faulty electrical work. Press reports at the time mentioned what was known of contractor Kellogg, Brown and Root's (KBR) role:
... Army documents obtained by CNN show that U.S.-paid contractor Kellogg, Brown and Root (KBR) inspected the building and found serious electrical problems a full 11 months before Maseth was electrocuted.
KBR noted "several safety issues concerning the improper grounding of electrical devices." But KBR's contract did not cover "fixing potential hazards." It covered repairing items only after they broke down. ...
Based on the testimony given at a Senate hearing on the matter, Senators Byron Dorgan (D-ND) and Bob Casey (D-PA) asked the Army to investigate. The results are in and the Army has changed Maseth's cause of death from "accidental" to "negligent homicide". And while this raises the possibility of criminal action against KBR, there's plenty of blame to go around.
Staff Sgt. Ryan Maseth, a 24 year old Green Beret, died in Iraq last January in a military base bathroom, of electrocution. He's one of 13 soldiers to die because of faulty electrical work. Press reports at the time mentioned what was known of contractor Kellogg, Brown and Root's (KBR) role:
... Army documents obtained by CNN show that U.S.-paid contractor Kellogg, Brown and Root (KBR) inspected the building and found serious electrical problems a full 11 months before Maseth was electrocuted.
KBR noted "several safety issues concerning the improper grounding of electrical devices." But KBR's contract did not cover "fixing potential hazards." It covered repairing items only after they broke down. ...
Based on the testimony given at a Senate hearing on the matter, Senators Byron Dorgan (D-ND) and Bob Casey (D-PA) asked the Army to investigate. The results are in and the Army has changed Maseth's cause of death from "accidental" to "negligent homicide". And while this raises the possibility of criminal action against KBR, there's plenty of blame to go around.
Why won't what Atrios calls the zombie lie (that Bob Casey Sr was supposedly denied a 1992 speaking slot for being pro-life) go away and die?
Probably because Bob Casey Jr. continues to spread it.
Today, at "God-o-Meter" (a joint Beliefnet.org/Time project), Dan Gilgoff posts this interview with Senator Casey, where the lie is given fresh life:
[Gilgoff:] Many pro-life Democrats were pushing for the opportunity for you to speak at the convention because of what it would represent symbolically, since your father was famously denied a speaking role at the 1992 convention over his pro-life views. Were you pushing for a speaking slot for that same reason?
[Casey:] We were invited to speak by Senator Obama's campaign and were grateful for the opportunity. But when you're in your first 18 months in the Senate, you shouldn't expect it. So I didn't ask.
A Choice - More of the Same or Something Different
On November 4th, voters will have a choice to make, not only in the race for President between Senator John McCain (More of the Same) and Senator Barack Obama (Something Different), but also in each of the contested races for seats in the US Congress.
Voters have to look no further than two recent congressional roll call votes to see a contrast between the Democratic and Republican parties. On May 21st, with solid Democratic support, HR 6049 passed on a 263 for / 160 against vote. HR 6049 provides energy, business and personal tax breaks totaling $55.5 billion to spur the production of non-fossil fuels, promote energy conservation, stimulate business activity and help homeowners and the working poor. In order to offset the costs of HR 6049, the bill tightens accounting rules on multinational corporations and eliminates certain offshore tax shelters and loopholes utilized by some US hedge fund managers. Most important, HR 6049 does not add any additional burden to the national debt.
Well, no not really, but I bet I got your attention and you started reading this diary planning to argue emphatically against me. However, I'm going to argue that a Democrat like Bob Casey is the proper choice as running mate for Barack Obama (who, I am assuming, will be our nominee).
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